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US stimulus stalemate, S&P 500 eyes record high

Week in review: US stimulus stalemate, Dollar doldrums, S&P 500 eyes record high

The week kicked off on a mixed note as investors digested the latest developments surrounding the new US fiscal package.

Over the weekend, President Donald Trump signed a series of executive orders aimed to support the US economy. Interestingly, equity markets across the globe pushed higher despite the uncertainty over when these measures would be enforced.

In our technical outlook, the currency spotlight was the GBPUSD which remained trapped in a wide 200 pip range with support at 1.3000 and resistance at 1.3200. Prices are trading around 1.3100 as of writing despite the UK economy officially entering a recession for the first time in 11 years!

US stimulus stalemate, S&P 500 eyes record high

Global sentiment received a solid boost mid-week after Russia announced that it registered the word’s first coronavirus vaccine. This welcome development fuelled appetite for riskier asset at the expense of safe-havens with Gold experiencing a “healthy” pullback below $1900. Rising bond yields played a role in Gold’s steep decline with US 10-year treasury yields rising to their highest level since early July.

US stimulus stalemate, S&P 500 eyes record high

As the impasse in Washington reverberated through financial markets, equity bulls remained unchained and unfazed. Risk-on is clearly in play with the S&P 500 trading very close to all-time highs as of writing despite the negative themes weighing on global sentiment.

US stimulus stalemate, S&P 500 eyes record high

If there was one word to describe the market performance over the past six months, the only word that comes to mind would be "surreal"!

Dollar struggles to rebound

It was not the best of trading weeks for the Dollar Index. Prices remain under pressure on the daily charts with a breakdown below 93.00 opening a path towards 92.20.

US stimulus stalemate, S&P 500 eyes record high

USDCAD breaks below 1.3250

After securing a daily close below the 1.3250, the USDCAD has the potential to extend losses in the week ahead. Prices remain bearish with the next key level of interest at 1.3100.

USDCAD breaks below 1.3250

AUDNZD eyes 1.1000

This currency pair is bullish on the daily charts. A solid weekly close above 1.0850 could instil bulls with enough inspiration to challenge 1.1000 in the near term.

AUDNZD eyes 1.1000

GBPJPY breakout in play 

The breakout above the 139.00 resistance level may signal further upside in the short to medium term. 139.00 could transform into dynamic support that opens a path towards 141.00.

AUDNZD eyes 1.1000

Disclaimer: The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.


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